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more hours, worse lifestyle
why would anyone do it then?
Different jobs, different people they can both be very lucrative....
different exit opps?
different exit opps yes, but structuring appeals to some people who wouldnt be good in trading.
What's a good way to tell where you'd better fit?
well structuring is not a risk taking role. it's desk by desk but if the aggressiveness factor of trading bothers you and you have a tough time getting yelled at and yelling at others, structuring can be a better and more cerebral choice.
How frequently and how tough is it to move from structuring to trading after 2 years or so? It seems like if you are on an actual desk in structuring (ie CDO's, credit derivatives, etc. you become intimately familiar with the product, just as much so as the traders themselves. Anyone know if this is common?
yes, luke it's common. but there are structurers who would never make good traders no matter how well they know the product. and usually they realize this and dont want to be traders anyway. one of our best structurers knows the products unbelievably well but doesn't have the temperment for trading
Bumping this for more opinions...and how quantitative is derivative structuring vs. derivative trading?
Read this thread we covered a lot:
http://www.wallstreetoasis.com/forums/structuring-within-st-pay-and-exi…
we've beaten this one to death over here:---http://www.wallstreetoasis.com/forums/structuring-within-st-pay-and-exi…
structuring vs trading (Originally Posted: 05/17/2013)
Hi guys,
I have got 2 offers from the same bank (top 3 american) for summer analyst 2014. One is on the cross asset structuring desk and the other for credit hybrids trading. I liked them both very much in interviews, in the next few days someone from each desk is going to call me, what kind of things would you ask? Also, what would you choose?
Thank you very much.
Congrats on the offers. Not sure what you mean by "top 3 american." What rankings are you referring to? Just inquiring because it seems odd to rank the institutions themselves as opposed to ranking expertise in their respective businesses (as it's usually done).
Will you be a part of the class competing for full-time offers, or do you still have multiple years of UG coursework to complete?
Congrats, not sure if they already asked you, is it a intern position?
JPM-GS let's say. I don't really know much about the rankings in each area...
Anyway this is going to be for the summer after this, and I will have another year of university left when I finish.
It is a summer intern position so I will be competing to get a full time offer.
I'm doing maths and both desks are quite quantitative, I really don't know which one to choose though!!
Structuring and trading are two very different roles, you need to figure out which one you like best and there you have your answer...
well, actually in my interviews I asked if there was much difference and they told me that for very complex and structured products the difference exists but is not that huge.
The roles are totally different. The structuring guys do similar work to bankers. They do a lot of underwriting and come up with new types of tailored trades for clients looking for a specific type of asset. The traders make the market for the product. Totally different
lol. This post is hilarious. Good luck trying to make markets in cross asset structured products mate.
Yes, in the more structured and complex products the roles are closer together, but there are still differences. I'm going to try and explain it as best as I can.
It varies by firm and desk, generally speaking in products like the ones you mentioned the structuring is done by the structuring team but with a lot of help from the traders, specially in the product and pricing part. Structuring does a lot more stuff, for example all the legal and marketing aspects, they will help or they might even do the whole pitch to the client.
The difference lies in the risk managing part and the time they are involved in the trade. After the deal is done, the structuring team forgets about it. But the trading desk now has a HUGE position in its book that's going to be there for years, and here is where their work begins. You need to look at the guys who trade products like the ones you mentioned not as market makers but as pure risk managers. They are not called through the box and BBG chat 45 times a day for prices, they just look at their book and try not to bankrupt the firm. There is no market for products like that because they are bespoke solutions. So your job basically is to decompose all the risks you might have and take care of them individually, which is much harder than it sounds because it will involve a lot of different assets, markets, rates, liquidities and currencies. You will have risks that you can only hedge through very illiquid avenues for example, so will need to look for products that are correlated for some reason instead of buying 75% of the market. But correlations break over time, so you need to hedge dynamically and be aware of a lot of markets all the time.
If you are looking for the more mathematical role, cross asset structuring is as hard as it gets on the floor. But like I said, I think you need to look at which role you prefer, because they are both going to be very challenging, it's not like trading credit hybrids is a walk in the park. You also need to assess which team you think you would fit in with personally. Also bear in mind that the learning period at the very complex trading desks tends to be a lot longer.
they told me it's like the difference between an F1 driver and an F1 engineer... they are different but both need to understand the underlying pretty well, and it wouldn't hurt the driver if he knew what was going on as well as the engineer.
so let's say I wanted to do the one where the most use of maths/technical skills is involved, which one would it be?
Very helpful info. Thanks, MDM
"they told me it's like the difference between an F1 driver and an F1 engineer... they are different but both need to understand the underlying pretty well, and it wouldn't hurt the driver if he knew what was going on as well as the engineer."
The one understands the car better...but the driver can handle the motion sickness and G's when things dont go as planned.
jimbo
Structuring vs Trading (exotic): i got doubts! (Originally Posted: 06/14/2012)
So, i'd like the community to clarify some matters about these two jobs. (i know they shouldn't be compared since trading is risk taking while structuring isn't but please play along!)
-Stress: Trading >> structuring -Hours: Trading=structuring, the only difference is that traders wake up earlier in the morning -Math involved: while in structuring you need good/exceptional math (not just models, even to quantitavely grasp the risk involved in each product) [besides common sense obviously!)] in order to succeed, in trading i think you don't need some beastly skill, mathematically speaking, altough you need to understand the products traded. -Pay: good trader >> structurer while bad trader structurer -Culture: should be more peaceful in structuring -Career: traders tend to get larger bonuses and to manage more money if they are successful. No clues about going up for structurers (please tell me!)
any misconceptions up here?
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